Automated interactive bill payment system using debit cards

ABSTRACT

Method and apparatus for processing payment transactions using debit card numbers without the requirement of a personal identification number (PIN) is disclosed. A telepay system of the present invention provides an interface between a standard touchtone telephone and at least one debit card network such that real-time bill payment transactions may be effected using a keypad of the telephone. The telepay system includes an interactive voice response unit for prompting a payor to enter an access code, account number, debit card number and payment amount and for informing the user of the status of the transaction. Real-time processing of transactions is provided through use of debit card networks, rather than the Automated Clearing House. The telepay system is also capable of performing settlement functions and processing inquiries by payees of the system regarding previously processed transactions.

CROSS-REFERENCE TO RELATED APPLICATIONS

This is a continuation of application Ser. No. 08/797,981 08/787,981filed on Jan. 22, 1997, now U.S. Pat. No. 5,715,298, which was acontinuation of application Ser. No. 649,926, filed May 16, 1996, nowU.S. Pat. No. 5,652,786, which was a continuation of application Ser.No. 442,129, filed May 16, 1995, now abandoned, which was a continuationof application Ser. No. 195,372 filed Feb. 14, 1994, now abandoned.

TECHNICAL FIELD

The invention relates generally to systems for electronic bill paymentsystems and, more particularly, to a universal, real-time bill paymentsystem method and system that uses debit (ATM) cards without therequirement of a PIN (personal identification number) in conjunctionwith touch tone telephones to initiate consumer bill paymentselectronically and provide for the elimination of paper checks and theheretofore use of the Automated Clearing House of the U.S. BankingSystem to settle individual items.

BACKGROUND OF THE INVENTION

Bill payment by telephone has been available primarily from financialinstitutions for approximately 15 years. Heralded as “home banking” thistechnology allowed a customer of a bank, savings and loan, or creditunion to pay any pre-registered bill with the use of a touch tonetelephone and that financial institutions interactive voice responseunit (provided that they offered the serviced The customer would firsthave to select a financial institution that offered the service, requestto participate in the service, send in a voided check, and then providea manual list of all the bills that were desired to be paid using thissystem. In addition, a signature authorization card would be to signedand archived by the financial institution. The financial institutionwould then manually input all of this information into their computer,and then advise the customer that system access was then available. Thisprocess usually took up to two weeks to complete.

Once activated, the customer would then have the capability to call thefinancial institution and input payment instructions in conjunction witha touch tone telephone and reference each payee by a number that wasassigned by the financial institution. This process of bill paymentwould allow the customer to pay bills by having the bank then issue an“electronic check” to the designated payee. This “electronic” documentwould then be presented to the Automated Clearing House of the U. S.Banking System for processing and clearing. In reality the process wasidentical to the processing of a paper check, with the only exceptionbeing that there was not any paper involved in the transaction. Thepayment could still “bounce” and be returned for non-sufficient fundssince there was no actual verification on the customer's account balanceto insure that sufficient funds were on deposit to cover thetransaction. In addition, all in place check clearing time requirementswere still in place, as it took typically at least 3-5 days to clear.Until clearing was realized the recipient of the funds never had actualuse of the funds used for payment. If a new debt was incurred, it wouldhave to be pre-registered on the system in order to utilize this“electronic” capability. If a customer changed financial institutions,the whole process of pre-registering all debts, signature cards, and avoided check would have to be repeated. Existing pay by phone systemsoffered some convenience to the user, but were cumbersome to administerand usage was never widespread.

As “home banking” gained more interest, many companies developed specialpurpose telephones with visual displays and “swipe card readers” thatthe consumer could purchase that would allow the use of a debit (ATM)card to basically achieve the same purpose as was evident in previouslyimplemented systems (for the purposes of brevity in this disclosure theterm “debit card” shall be construed to mean both debit and creditcard). The only differences is that the consumer could now “swipe” thedebit card through the reader that was part of the telephone. TheAutomated Clearing House of the U. S. Banking System was still used toprocess payments, and all pre-registration and signature cards werestill required. All “electronic check” clearing time requirements werestill needed, and the transaction would still be returned fornon-sufficient funds. If a service offered a specialized telephone andbypassed the Automated Clearing House, using debit card networks, thedebit card used to process the transaction required a PIN. There was anatural resistance to the purchase of special telephones that proved tobe relatively expensive, in addition to the monthly fees necessary toremain a customer of this service.

As personal computers began to proliferate, many systems becameavailable that would allow bill payment in conjunction with a thirdparty service and a personal computer owned by the user with that thirdparty software loaded into it, such as the Prodigy system. Still,however, all of the aforementioned limitations still applied to thesepersonal computer based systems.

In summary, these home banking systems shared many common drawbacks. Forexample, the burden of pre-registration and the listing of bills to bepaid was borne by the consumer. The system required the processing oftransaction in the same manner as a paper check, or an electronic checkthrough the Automated Clearing House of the U.S. Banking System. Thesystem presented the possibility that a transaction could be returnedfor non-sufficient funds reasons. In addition, a clearing time for eachtransaction of 3-5 days. Furthermore, in many cases, the prior art homebanking systems required the use of specialized equipment by thecustomer (such as special purpose telephones equipped with electroniccard readers or encryption devices), or the financial institutionoffering services to it's customer base.

Moreover, although it is known in the field of accounting to call andmanually, in conjunction an operator, verify that a payor had remitted abill, there is no capability for the recipient of the funds (payee) toelectronically immediately and positively inquire as to payment statusafter it was electronically authorized by the a debit card network.Therefore, what is needed is a universal, real-time bill payment systemmethod and system that uses debit (ATM) cards without the requirement ofa PIN (personal identification number) in conjunction with touch tonetelephones to initiate consumer bill payments electronically and providefor the elimination of paper checks, as well as the use of the AutomatedClearing House.

SUMMARY OF THE INVENTION

The foregoing problems are solved and a technical advance is achieved bymethod and apparatus of the present invention for an improved universalbill payment system. In a departure from the art, bills may be paidusing a telephone connectable to at least one remote debit card networkvia a telepay system.

In a preferred embodiment, the method of the present invention comprisessteps of prompting a caller to enter an access code using a keypad ofsaid telephone, said access code identifying a current paymenttransaction; responsive to entry of an access code, determining whethersaid entered access code is valid; prompting said caller to enter anaccount number using said telephone keypad said account numberidentifying a payee in connection with said current payment transaction;responsive to entry of an account number, determining whether saidentered account number is valid; prompting said caller to enter a debitcard number using said telephone keypad, said debit card numberidentifying a payor in connection with said current payment transaction;responsive to entry of a debit card number, determining whether saidentered debit card number is valid; prompting said caller to enter apayment amount using said telephone keypad; responsive to adetermination that a payment amount has been entered and furtherresponsive to a determination that said entered access code, accountnumber and debit card number are valid accessing a remote debit cardnetwork associated with said entered debit card number, said accessedremote debit card network determining whether sufficient funds exist inan account associated with said entered debit card number to completesaid current payment transaction, responsive to a determination thatsufficient funds exist in said associated account, deducting saidentered payment amount from said account associated with said entereddebit card number, adding said entered payment amount to an accountassociated with said entered account number and informing said caller ofan approval code issued by said accessed remote debit card network andstoring said entered access code, account number, debit card number andpayment amount in a transaction log file of said telepay system, andresponsive to a determination that sufficient funds do not exist in saidassociated account, informing said caller that said current paymenttransaction has been declined and terminating said current paymenttransaction.

A technical advantage achieved with the invention is that it enables theuse of debit card (ATM) networks for a real-time positively authorizedbill payment that inquire electronically against balances on depositPRIOR to the processing of the bill payment transaction, thuseliminating the Automated Clearing House to process individualtransactions.

Another technical advantage achieved with the invention is that itenables real-time inquiry capability into the consumers balances atvirtually any U.S. financial institution in order to verify funds ondeposit prior to processing the transaction, thereby eliminating thepossibility of a non-sufficient funds occurrence.

Another technical advantage achieved with the invention is theelimination of a PIN (personal identification number) in conjunctionwith debit card number usage in order to comply with Regulation E of theU.S. Banking Regulations by maintaining security and frequency of usagerestrictions in the method and process.

Yet another technical advantage achieved with the invention is theintegration of interactive voice response technology and debit cardnumber authorization processing with electronic funds transfer billpayment method and process.

Still another technical advantage achieved with the invention is theelimination of any specialized equipment on the part of the consumer toprocess an electronic bill payment (i.e., personal computers,specialized telephones or terminals, etc.).

A further technical advantage achieved with the invention is theelimination of any pre-registration or “sign up” procedure on the partof the payor.

A final technical advantage achieved with the invention is the provisionto the recipient of the bill payment of an electronic daily generalledger or activity summary, that balances back to the gross amount ofelectronic deposits made in the designated bank accounts by the utilizeddebit card networks. Moreover, the system of the present inventionoffers to the consumer the advantage of anywhere, anyplace, anytime,convenience with complete spontaneity as to the system usage.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a block diagram of a telepay system embodying features of thepresent invention.

FIGS. 2A-2G illustrate a flowchart of a bill payment transaction processof the present invention.

FIG. 3 is a flowchart of a settlement process of the present invention.

FIG. 4 is a flowchart of a payee inquiry process of the presentinvention.

DESCRIPTION OF THE PREFERRED EMBODIMENT

Referring to FIG. 1, the general operation and structure of the systemof the present invention will be described, it being understood that theoperation of the system will be described in greater detail withreference to FIGS. 2.1, 2.7, 3.1 and 4.1 2A-2G, 3 and 4. When a consumercalls into the TelePay system 10 using a telephone 12, the consumer isprompted by an interactive voice response unit within the system 10 toinput certain necessary information, to wit, payee access code, debitcard number, account number, and amount. The TelePay system 10 thenchecks all of its internal files, including an account number velocityfile 14, a debit card velocity file 16 and a negative file 18, tovalidate the access code entered, the card number presented, thevalidity of the account number, and if that card number and/or accountnumber has ever processed a fraudulent transaction. If any of theseinternal checks into the TelePay system 10 process indicate fraud, thenthe transaction is denied. If all of the checks are passed, then theTelePay system 10 assembles the data into an authorization requestmessage, which is electronically sent to a debit card network 20 fortransmission to a financial institution 22 that issued the card forverification of balance on deposit.

The debit card network 20 receives a response as to whether or not thethere are sufficient funds on deposit to process the transactionrequested by the consumer. The debit card network 20 prepares anappropriate deduction from the consumer's account and prepares anappropriate deposit to the payee's account to be processed later. Inaddition any fees that are due from the payor are also preprocessed atthis time. The debit card network then sends a message to the TelePaysystem 10 while the consumer is still on the telephone 12 line. TheTelePay system 10 will then translate the numeric data received into anaudible verbal response transmitted to the consumer via the telephone12.

Settlement, as described in greater detail, with reference to FIG. 3.13, is defined herein as the methodology of debiting and crediting theappropriate accounts affected by the above-described transaction. Theseaccounts would affect the payor, the payee, and the TelePay system 10for any transaction fee. The debit card network 20 will initiate thisprocess. The debit card network 20, however will only deposit a TOTAL ofthe days transactions into the payee's account. The network has nocapability to discern which consumer paid how much. It then becomes theresponsibility of the TelePay system 10 to detail the specific accountnumbers and amount of payments that were made that day. This isaccomplished by a computer dial-up link (RJE) 24 from the TelePay system10 to the payee's billing system 26. The TelePay system 10 will alsobill the payee on a monthly basis for 800 telephone line usage (if any).The accounts receivable department of the payee is also provided withthe capability to call into the TelePay system 10 to inquire as to ifand when a consumer initiated a payment.

A single 800 number is used by the TelePay system 10. Technology allowsfor a virtually unlimited number of telephone lines to terminate on thesame number, limited only by the compliment of computer hardware andit's capabilities that are running the system. The caller will be askedto enter the access code of the bill to be paid. This access codetypically will be printed on the bottom of the statement in an obviousmanner and is a requirement of all payees utilizing the service. Thecode will identify the payee within the TelePay system 10 and willactivate the TelePay software to verbalize the customer's selection inorder to give positive re-enforcement as is the case with all customerinput (i.e. “you have elected to pay Florida Power and Light in Miami,Fla. ” Press 1 if this is correct and you wish to continue, or press 2if incorrect”). If incorrect, the customer will be asked to inputanother access code, or to terminate the call. Assuming the properaccess code is confirmed, the next step will be the entering of theaccount number of the bill to be paid, as this number also appears onthe monthly statement. All selections will be verbally re-enforced.

The next step will be the entering of the debit (ATM) card number.Various TelePay system 10 checks will be done on this entry. Verbalre-enforcement of the numbers entered is again given to the user (“Youhave entered 5419 23485 4657. Please press 1 if correct or 2 ifincorrect”). The TelePay system 10 will then instruct the user to enterthe amount of the payment and verbal positive re-enforcement will begiven. If all has been acknowledge positively up to this point, then thesystem will give a verbal summary of the transaction and give thecustomer a final opportunity to validate the entries (“Press 1 ifcorrect, or press 2 if incorrect”). When the transaction has beenpositively re-enforced by the user, the TelePay system will then buildan authorization request that will be sent out to the existing debit(Electronic Funds Transfer) networks. When the transaction has beenauthorized, the system will once again give positive re-enforcement tothe user (“Your payment to Dallas Gas and Electric in the amount or$124.56 has been paid from your ATM card account number 5419 23485 4657.Your authorization number for this transaction is XXXXXXX. Please make anote of this authorization code for future reference. If you would liketo hear the authorization code for this transaction again, press 1. Ifyou would like to pay another bill press 2. If you are finished press3.”).

If the user elects to pay another bill during the same session, then thesystem will retain the previously entered card number and ask the callerif the next bill being paid is to be paid with the same card, or allowthe opportunity to enter a new card number.

All of the debit (Electronic Funds Transfer) networks are accustomed tothe assessment, debiting and crediting of fees to the issuers andacquirers of debit (ATM) and credit transactions. In many cases, a 75¢fee for a customer to use an ATM card at an ATM that is not owned by thecard issuing bank involves the dividing of that fee into increments assmall as 5¢. In this manner all networks that are accessed arecompensated to assist in the authorization and routing of thetransaction. All of these fees are electronically credited to the entitythat earned the revenue as a result of a contractual relationship withthat particular network. This process happens every working day at apredetermined “cut off” period that separates business days and isrefereed to in the industry as “settlement”.

Never before, however, has a transaction been presented to the debitnetworks for a real-time authorized bill payment initiated by theconsumer from a touch tone telephone with the debit card used as thetransaction vehicle. Additionally, it has never been done without therequirement of a PIN (personal identification number) and still maintaintransaction security. In the TelePay System 10, when a transaction isentered by a consumer, and subsequently passed on to an outside debitcard network for authorization, a number of things happen.

Assuming that the transaction is authorized, then any fee that thecustomer is paying, in addition to the actual bill payment, isautomatically deducted from the payor's account immediately and added tothe amount that the debit card network will owe TelePay and the payee atsettlement. The amount of the bill that was paid is automatically addedto the amount that will be credited to the payee at the end of thebusiness day (every payee is required to provide a bank account numberthat will be used to electronically credit the days receipts). TelePay'sbank account will, in a like manner, be automatically credited for thetransaction fee. Any network usage fees that have to be paid to processthe transaction by the use of an debit card network will beelectronically paid by the TelePay system 10 to the appropriate serviceprovider. Once a day at TelePay's settlement time, each payeeparticipating in the system will receive the electronic on-line detailsummary of the days individual transactions for posting to theconsumer's account.

A flowchart illustrating the operation of a bill payment transactionprocess of the TelePay system 10 is shown in FIGS. 2.1-2.7 2A-2G. Theprocess is initiated by a user's calling into the system 10. In step200, a general purpose welcome message that announces and instructs thecaller in the manner with which the system can be used is transmitted tothe user via the telephone 12 (FIG. 1.1 1). In step 202, the user isprompted to enter a payee access code, which is assigned by theembodiment of the invention in the form of a service and the user ismade aware of this code due to its printed presence on the monthlycustomer statement, statement stuffers or other printed handouts. Thiscode is what distinguishes one payee from the other, and is theidentifier that causes the system 10 (FIG. 1.1 1) to record thetransaction in the appropriate payee record file.

After the caller enters the access code, it is electronically checkedagainst the list of authorized payees participating in the system 10 instep 204. In step 206, a determination is made whether the enteredaccess code is valid. If the access code is invalid, in step 208, thesystem 10 checks to determine whether this is the third incorrect entryof an access code. If this is not the third incorrect entry of theaccess code, in step 210, the system 10 instructs the caller that theaccess code is invalid, and offers the caller to opportunity to re-enterthe access code in step 202. If this is the third incorrect entry of anaccess code, in step 212, the system 10 instructs the caller to checkthe access code information and call again.

If the access code is entered properly within three attempts, in step214, the caller is prompted to enter the account number of the bill thatthey are paying. In step 216, the system 10 checks the account numberfor validity. The validity check is based on the methodology that thepayee uses to verify account numbers and will vary according to payee.The system 10 will have all of the participating payees verificationmethodologies. This methodology could be a MOD 10 or MOD 11 check digitroutine with or without a check digit in it's most basic implementation.In a mere sophisticated environment, the system would have in it'sdatabase, a list of all the valid account numbers for that particularpayee, commonly known to those skilled in the art as a “shadow file.”

In step 218 (FIG. 2.2 2B), a determination is made as to the validity ofthe account number entered. If the entered account number is not valid,in step 220, a determination is made as to whether this is the thirdincorrect entry. If it is not the third incorrect entry, in step 221(FIG. 2.1 2A), the caller is informed that the entry is invalid and isgiven an opportunity to reenter the account number. If the entry attemptis the third invalid attempt, in step 222, the caller is instructed tocheck their information and call again. If a valid account number isentered within three attempts, in step 224, the system 10 requests thecaller to enter the debit card number.

In step 226, the debit card number is checked for validity. Thisvalidity check is done via the MOD 10 algorithm that is the basis fordebit card issuance used by financial institutions. Using this methodthat is commonly used, and familiar to those skilled in the art, gives agreat level of assurance that the number that was entered by the callerwas entered properly. In step 228, a determination is made whether theentered debit card number is valid. If the entered debit card number isnot valid, in step 230, a determination is made whether this is thethird invalid entry. If this is not the third invalid entry, in step232, the caller is instructed of the invalid entry and then, in step224, is requested to enter a debit card number.

If this is the third invalid entry, in step 234, the system 10 requeststhe caller to check their information and call again. Once a valid debitcard number is entered within three attempts, in step 236 (FIG. 2.3 2C),the caller is requested to enter the dollar amount (without a decimal)of the bill to be paid. In step 238, the system 10 repeats the enteredamount to the caller and, in step 240, asks the caller to indicatewhether the entry is correct by depressing a key on the keypad of thetelephone 12. In step 242, a determination is made whether the callerresponded that the entry is correct. If the entry is not correct, instep 244, a determination is made whether this is the third incorrectentry. If this is not the third incorrect entry, in step 236, the calleris requested to enter a new dollar amount. If this is the thirdincorrect entry, in step 246, the caller is requested to check theirinformation and call again.

If the caller enters a correct amount within three attempts, in step 248(FIG. 2.4 2D), the system 10 initiates a velocity file 14 check. Thevelocity file 14 is an internal file to this invention that restrictsthe number of times that a payor account number can be paidelectronically using the system 10 over a 30 day period. The numericalvalue of the velocity file is individually selectable by each payeeparticipating in the system 10, and will prevent excessive payments fromtheir customers that have the potential for fraud. In step 250, ifpayments are located in the velocity file 14 that indicate to the system10 a violation of the number of transactions permitted over a 30 dayperiod by the payee, in step 252, the caller is notified that theirtransaction cannot be processed, due to the excessive frequency ofusage. If the transaction is within the number allowed by the payee overa thirty day period, in step 254, the system 10 performs the velocityfile check on the debit card number that the caller entered.

The numerical value of the debit card velocity file 16 is determined bythe system 10 based on, but not limited to, historical usage data of allpayees and payors over a given period of time. This value is variableand is achieved generally by multiplying the total number of payeesparticipating in the system times the total number of payments allowedby each payee over a 30 day period. If the system 10 determines that thetransaction by the payor exceeds the debit card velocity file criteria,in step 256, the caller is notified that the transaction cannot beprocessed due to the frequency of the number of uses of the debit cardused to process transactions over a thirty day period.

If the transaction by the payor does not exceed the debit card velocityfile criteria, in step 258 (FIG. 2.5 2E), the system 10 determineswhether either the payor account number or the debit card number iscontained in the negative file 18 comprising a database of negativeaccounts stored on the system 10. The purpose of the negative file 18maintained by the system 10 is to prevent debit card numbers and accountnumbers that have been involved in fraudulent transactions frominitiating another transaction. This file is updated by payeesparticipating in the system by written notification to the service. Anemployee of the service would then update the system.

If the system 10 determines that a match on either payor account numberor debit card number has been found, in step 260, the caller is informedthat the transaction cannot be processed. If there is not a match foundon the negative file 16, then the details of the transaction aresummarized to the caller verbally on the interactive voice responsesystem in step 262. In step 264, the caller is prompted to begin theprocessing of the transaction by pressing one (1) on the telephonekeypad, or by pressing two (2) on the telephone keypad to abort thetransaction. In step 266, the system 10 checks the caller's response. Iftwo has been depressed by the caller, in step 268, the system 10 thanksthe caller and terminates the call.

If one has been depressed by the caller, in step 270 (FIG. 2.6 2F), thesystem 10 outdials via a normal telephone line to an appropriate debitcard network, such as the network 20 for processing. A debit cardnetwork is a third party processor that will process the transaction fora fee, providing connectivity to either the financial institution thatissued the debit card number, or another debit card network that has thecapability to connect with the financial institution that issued thedebit card number.

Those skilled in the art are aware that a debit card network, i.e. Pulsein Houston, Tex. MOST in Washington D.C., Honor in Maitland, Fla. etc.,process primarily ATM (Automated Teller Machine) transactions, and donot rely on the Automated Clearing House (ACH) to process individualtransactions. In addition to the face value of the bill to be paid, thesystem adds a service charge that the caller will electronically pay foruse of the convenience of the system. Through the use of the debit cardnetwork, rather than the ACH, the transaction is positively verifiedagainst funds on deposit prior to the processing of the transaction. Instep 272, while the system 10 is outdialing to the debit card network20, the system 20 plays a customized individually recorded marketingmessage for each payee utilizing the system 10, that will promote aservice of the payee while the caller is awaiting approval. If the debitcard network and the subsequent transmission to other debit cardnetworks (if required) make the determination that funds are notavailable in the caller's account selected by the debit card number,then the transaction will be declined.

In step 274, the system 10 awaits a reply from the debit card network20. In step 276, the system 10 then makes a determination on thedisposition of the transaction based on the response received back formthe debit card network 20. If the response from the debit card network20 indicates to the system 10 a declination, with which those skilled inthe art are familiar, in step 278, the system 10 informs the caller thatthe transaction was declined by the financial institution that issuedtheir debit card number. If the response from the debit card network 20indicates an approval, the caller will be verbally informed of theapproval code in step 280. In step 282, the approved transaction isupdated in a system transaction log file that will later become thebasis for the transmission for payment data to each individual payee.The transaction log file contains the debit card number, payor accountnumber of the bill paid, amount of the bill paid, time/date, andapproval code. The log file is individually kept for each payeeparticipating in the system for later electronic transmission forbilling system update.

In step 284 (FIG. 2.7 2G), when a transaction is successfully completed,the aforementioned debit card number velocity file that was checked aspart of the pre-processing procedures is updated to reflect thetransaction. In step 286, the velocity file for the account number ofthe bill that was paid is updated to reflect the transaction. In step288, the system 10 asks the caller if he or she would like to payanother bill by requesting the caller to press one (1) to pay anotherbill, or two (2) to terminate the call. In step 290, the system 10 makesa determination as to whether the caller would like to make anotherpayment, based on the response indicated by the caller. If a one waspressed, the system 10 prompts the caller for another access code instep 202 (FIG. 2.1 2A). If a two is pressed, the system 10 terminatesthe call in step 292.

FIG. 3.1 3 is a flowchart of the settlement process of the presentinvention. After close of the business day, by the debit card network20, the debit card network 20 begins to move the funds electronically; aprocess with which those skilled in the art are familiar. At that pointthe system 10 is in a position to transmit the detail of the daystransactions to the individual payees that will be receiving electroniccredits from the debit card network 20. The debit card networks transmitonly the gross dollar amount of funds for crediting to each payee. Thesystem 10 performs the actual detail of the electronic transmission ofindividually paid accounts. The system 10 will recognize the time of dayby the internal clock common to most computer systems, and select thefirst payee in the aforementioned transaction log file. In step 300, thesystem 10 will outdial using an ordinary telephone line into the firstpayee on the system in an effort to connect to the computer billingsystem 26 (FIG. 1.1 1).

Once a telephonic connection is established, in step 302, the system 10begins the process of transmitting the payor account numbers and amountsof the bills that were paid since the last settlement period using thesystem 10. This process is known to those skilled in the art as remotejob entry (RJE). In step 3143 the system 10 determines whether there areother files to be transmitted. In step 306, the system 10 outdials theappropriate telephone number established in advance to establish atelephonic RJE link with the next payee. In step 302, in a mannersimilar to the aforementioned, the transactions that the system 10performed in favor of that particular payee will be transmitted to thatpayee's computer billing system 10. Once all the files have beentransmitted, the settlement process is terminated in step 308.

FIG. 4.1 4 is a flowchart of a payee inquiry process of the presentinvention, which provides a payee with the ability to initiate atelephone call into the present invention operating as a third party tothe transaction, in order that payment information can be discerned inconjunction with a touch tone telephone. The process is initiated by apayee calling into the system 10. In step 400, the system 400 will askthe caller to input a security code, which is assigned to each payee andis different for each payee. The input of a proper code will indicate tothe system which payee payments are to be inquired upon. Without aproper code, no inquiry access is permitted. It is important torecognize that this system capability is for the payee, and not for theactual payor of the bill. This system capability assists in past duecollection activity.

In step 402, the system 10 checks its internal data files to ascertainthe validity of the code entered. If an improper code is entered, instep 404, the system 10 informs the caller that the code is invalid. Ifthe entered code matches one that was contained in the system database,in step 406, the system 10 requests the caller to enter the accountnumber of the customer whose bill is being inquired upon. After thecaller enters the account number, in step 408, the system attempts tolocate it on the system database. If the system 10 cannot locate theaccount number, in step 410, the caller is informed that no paymentexists for the entered account number and is given an opportunity toenter another account number in step 406. If the entered account numberis located, in step 412, the system 10 informs the caller of the detailsof the transaction, to wit, time, date, amount, and authorization numberof the payment. In step 414, upon completion of the audio textinformation, the caller is asked whether he or she has another inquiryto perform. If so, in step 406, the system 10 prompts the caller toenter the account number; otherwise, the system 10 terminates the callin step 416.

The crux of this invention is that bill payment transactions have neverbeen presented to the debit networks for a real-time authorizationinitiated by the consumer from a touch tone telephone with the debitcard number used as the transaction vehicle. Additionally, this processhas never been done without the requirement of a PIN (personalidentification number) and still maintain an assemblage of transactionsecurity. In the TelePay System, when a transaction is entered by aconsumer, and subsequently passed on to an outside debit card networkfor authorization, a number of things happen. Assuming that thetransaction is authorized, then any fee that the customer is paying, inaddition to the-actual bill payment, is automatically deducted from thepayor's account immediately and added to the amount that the debit cardnetwork will distribute between TelePay and the payee at settlement. Theamount of the bill that was paid is automatically added to the amountthat will be credited to the payee at the end of the business day (everypayee is required to provide a bank account number that will be used toelectronically credit the days receipts). Telepay's bank account will,in a like manner, be automatically credited for the transaction fee. Anynetwork usage fees that have to be paid to process the transaction bythe use of an debit card network will be electronically paid by TelePayto the appropriate service provider. Once a day at TelePay's settlementtime, each payee participating in the system will receive the electronicon-line detail summary of the days individual transactions for postingto the consumer's account.

The following criteria and conditions are part of the TelePay method andunique process prior to the acceptance of a debit card number into thesystem in order to ensure a proper transaction has been presented and toadd a level of usage security. First, a service address (telephonenumber or residential electricity site, etc.) or payee account numbercan only be the recipient of a specific limited number of paymentswithin 30 days that is selectable by the funds recipient and a velocityfile by account number is kept at the TelePay system tracking thislimitation. In addition, a debit card number can only be used in theTelePay system a specific limited number of times based on a recipientof funds selectable parameter and current recipient of funds (payee)negative files due to adverse experience are added to the TelePay systemprior to implementation.

Still further, any consumer chargebacks will prevent that customer'stelephone number/electricity service address number and thatcredit/debit card number to have system access. Appropriate additionswill be made to the negative file unless specific overrides arerequested by the funds recipient. Also, all transactions will be routedelectronically to the card issuing entity/network by the TelePay systemfor positive authorization as to card acceptability, credit limitguidelines, payment status, balance availability, and any and allcriteria that the issuer deems appropriate.

Additionally, the TelePay system will provide records of alldeclinations by card number and by telephone number, electric serviceaccount number, or payer account number, whichever is appropriate and acheck will be done on all debit card numbers entered into the TelePaysystem to ensure that the input number is an assigned number within thecriteria of the issuing entities, as well as on service address accountnumbers to insure that the proper number and sequence of digits havebeen entered to add an additional level of accuracy to the numeric entryprocess. Moreover, the customer will always be given positive audioreinforcement at critical steps during the data entry process to assistin the entry of accurate information and transaction declinations due tonon-sufficient funds will be audio referred for the consumer to contacttheir card issuing institution.

Accordingly, it is clear that the TelePay system is a technologicallyadvanced and consumer convenient process. The consumer may use theTelePay system to pay bills at will, spontaneously, without any personalinvestment in equipment, and any requirement of pre-registration. Theuse of the TelePay system is not tied to a specific locations, as anytouch tone telephone will suffice. Use of this unique process willeliminate the use of stamps, envelopes, the U. S. Postal Service, andthe necessity of going to a mailbox. Personal computers and the lack ofrealistic portability are problems that do not exist in the presentinvention. Receipt of payment is also assured and issues of “lost in themail” or mail delays will no longer exist. Debit cards will now havetrue utility as transaction vehicles in order to electronically presentpayment as opposed to paper checks. Older technology of pre-registrationand direct debit registration systems will become obsolete.

It is understood that the present invention can take many forms andembodiments. The embodiments shown herein are intended to illustraterather than to limit the invention, it being appreciated that variationsmay be made without departing from the spirit of the scope of theinvention. For example, it is anticipated that the payor may be anindividual or an institution, such as a corporation or association.

Although illustrative embodiments of the invention have been shown anddescribed, a wide range of modification, change and substitution isintended in the foregoing disclosure and in some instances some featuresof the present invention may be employed without a corresponding use ofthe other features. Accordingly, it is appropriate that the appendedclaims be construed broadly and in a manner consistent with the scope ofthe invention.

1. A method of paying bills using a telecommunications line connectableto at least one remote payment card network via a payee's agent'ssystem, wherein a caller begins session using a telecommunications lineto initiate a spontaneous payment transaction to a payee, the methodcomprising the steps of: prompting the caller to enter an account numberidentifying an account of a payor with the payee in connection with thepayment transaction; prompting the caller to enter a payment numberselected from one or more choices of credit or debit forms of payment;prompting the caller to enter a payment amount for the paymenttransaction; upon a payment amount being entered and during the session,accessing a remote payment network associated with the entered paymentnumber, the accessed remote payment network determining, during thesession, whether sufficient available credit or funds exist in anaccount associated with the entered payment number to complete thepayment transaction, and responsive to a determination that sufficientavailable credit or funds exist in the associated account, charging theentered payment amount against the account associated with the enteredpayment number, adding the entered payment amount to an accountassociated with the entered account number, informing the caller thatthe payment transaction has been authorized, and storing the accountnumber, payment number and payment amount in a transaction log file ofthe system.
 2. The method of claim 1 wherein said payment number is aPIN-less credit or debit card number.
 3. The method of claim 1 whereinsaid payment number is a debit card number or debit payment in the formof an electronic check.
 4. The method of claim 1 further comprising thesteps of prompting the caller to select a credit or debit option,prompting the caller to enter a payment amount, and prompting the callerto acknowledge a transaction fee to the payee's agent's system.
 5. Themethod of claim 1 further comprising the step of prompting the caller toindicate the type of payment, said payment being at least one ofdeposit, regular payment, or reconnect fee.
 6. A method of paying billsusing a telecommunications network line connectable to at least oneremote payment card network via a payee's agent's system, wherein acaller begins session using a telecommunications network line toinitiate a spontaneous payment transaction to a payee, the methodcomprising the steps of: prompting the caller to enter a payment numberselected from one or more choices of credit or debit forms of payment;prompting the caller to enter a payment amount for the paymenttransaction; accessing a remote payment network associated with theentered payment number, the accessed remote payment network determining,during the session, whether sufficient available credit or funds existin an account associated with the entered payment number to complete thepayment transaction, and upon a determination that sufficient availablecredit or funds exist in the associated account, charging the enteredpayment amount against the account associated with the entered paymentnumber, adding the entered payment amount to an account associated withthe entered account number, and storing the account number, paymentnumber and payment amount in a transaction file of the system.
 7. Themethod of claim 6 wherein said payment number is a PIN-less credit ordebit card number.
 8. The method of claim 6 further comprising the stepsof prompting the caller to select a credit or debit option, promptingthe caller to enter a payment amount, and prompting the caller toacknowledge a transaction fee to the payee's agent's system.